Government of India Extends Full Customs Duty Exemption on Critical Petrochemical Products Until July 15, 2026

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Dated: 02.07.2026

Government of India Extends Full Customs Duty Exemption on Critical Petrochemical Products Until July 15, 2026

The Indian government has announced an extension of the full customs duty exemption on critical petrochemical products, now valid until July 15, 2026. This move comes as a response to ongoing disruptions in global supply chains caused by the conflict in West Asia, aiming to support domestic manufacturing and ensure the steady availability of essential raw materials.

Background: Addressing Supply Chain Disruptions

Initially, the government introduced a full customs duty exemption on imports of key petrochemical products as a temporary relief measure. The exemption was set to expire on June 30, 2026, but has now been extended by 15 days to facilitate a smooth transition as the situation in West Asia gradually normalizes.

The primary reason for this exemption was to counteract the supply shortages resulting from the conflict, which had a direct impact on the availability of petrochemicals in India. During this period, Indian petroleum companies were directed to focus on the production of LPG, further constraining the supply of other petrochemical products.

Key Details of the Exemption

Duration: The exemption is now valid until July 15, 2026.
Scope: The list of critical petrochemical products covered by the exemption remains unchanged from previous notifications.
Objective: To ensure sufficient availability of petrochemicals for domestic industries and prevent disruptions in manufacturing.

Impact on Indian Industries

The extension of the customs duty exemption is expected to benefit a wide range of sectors that rely on petrochemical feedstock and intermediates, including:

Plastics and Packaging
- Ensures steady supply of raw materials for packaging manufacturers and plastic product makers.
Textiles
- Supports synthetic fiber and fabric production, which depend on petrochemical inputs.
Pharmaceuticals and Chemicals
- Maintains the flow of essential intermediates for drug and chemical manufacturing.
Automotive Components
- Secures materials needed for producing various automotive parts.
Other Manufacturing Segments
- Provides relief to a broad spectrum of industries that use petrochemical derivatives.

Benefits for Consumers

By stabilizing the supply of petrochemicals, the exemption helps prevent price spikes and shortages in finished goods, ultimately benefiting end consumers. This measure is part of the government’s broader commitment to supporting the manufacturing sector and ensuring economic stability during periods of international uncertainty.

Government’s Commitment

The Ministry of Finance has reiterated its dedication to supporting India’s manufacturing sector through targeted policy interventions. The extension of the customs duty exemption is a testament to the government’s proactive approach in mitigating the impact of global disruptions on the domestic economy.

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Source: Ministry of Finance

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